How To Make Your Short Term Rental Business A Success With An ADU

If you own a short-term rental property, or are thinking of starting one, whether it's an urban house, a backyard ADU, a casita, or a remote cabin in the woods, there are a few key things you need to know in order to run it successfully and profitably. Especially if you want to build an ADU as an investment and earn passive income.

1. Short Term Rental Rules and Regulations

   Understand the laws and regulations that apply to your property. Different areas have different rules regarding short-term rentals, including zoning laws, occupancy limits, and tax or licensure requirements. It's important to understand these laws and regulations in order to avoid any legal issues or fines. You should also be aware of any specific requirements or restrictions that may apply to your property, such as noise or parking restrictions. It is important to be familiar with these and work with your local jurisdiction to file any necessary paperwork and obtain the right business licenses so you don’t get shut down. Running a short term rental is running a business and most cities or states will consider your rental a business and expect you to follow their business rules.

2. Booking and Reservation Management and Fees

   Set up a system for booking and managing reservations. This may include setting up a custom website or listing your property on a popular platform like Airbnb or VRBO - although understand the fees they charge in order for you to be listed on their sites. You should also develop policies for booking and cancellation, as well as any additional fees or charges that you may want to add to the nightly rental fee. We have had past success on Airbnb, renting out an ADU we owned, and are currently building a small cabin we will rent out to friends and family through a custom booking site. We required a 2-night minimum in order to make it worth renting it out, we added a cleaning fee on top of the nightly rental amount (it is a single cleaning fee for the duration of the stay), and we also paid a percentage of the total fee to Airbnb.

3. Cleaning and Maintenance of the Short Term ADU Rental

   Develop a system for cleaning and maintaining the property. Keeping your property clean and well-maintained is essential for attracting guests and maintaining a good reputation. It is also a considerable amount of work, thus it is very important to plan ahead. Develop a system for cleaning and maintaining the property, including a schedule for regular deep cleaning, repairs, and maintenance. You may want to consider hiring a professional cleaning company or designating a staff member to handle some of these tasks. We set up a system with a professional cleaner and they would automatically get scheduled to clean after any reservation was made. It was a great way to reduce the amount of work we had to do to manage the rental and ensure the next guest had a great experience.

   Part of running a short term rental businesses is planning for and budgeting these costs. You may think that you are charging enough to turn a profit but then get hit by unexpected repair costs that eat through what you earned. Make sure you are setting your rental rates after planning for ongoing cleaning, maintenance, and repairs so you don’t get caught by surprise. It is also recommended that you set aside some of the profits each month into a separate account that you then use to pay for minor repairs or significant maintenance or upgrades. And track all of these expenses so you can deduct them when filing your annual taxes.

4. Guest Rental Policies and Procedures

   In order to ensure that your property is well-respected by guests, it's important to have clear policies and procedures in place and written in both the reservation platform and on site. These may include rules regarding noise, parties, smoking, and pets, as well as any other specific requirements or restrictions that you want to impose on how they use your space. Communicate these policies to your guests before their stay and make sure that they understand and agree to follow them. We also recommend having them printed and available on site as part of a guestbook or binder that they can access when needed. As each house, ADU, or cabin is unique, having a short “How To” guide with the basis for the house is a great way to make your guests feel at home. Give simple instructions on how to operate the heat and air conditioning, directions on where to find basics like extra toilet paper or towels, and a simple guide to activities on the property or in the surrounding area. If there are areas of the ADU or property you don’t want to them to use or there are specific places they should park, add these to the guide.

5. Provide Amenities and Supplies for Guests.

   To make your property as attractive and comfortable as possible, it's important to provide amenities and supplies for your guests. This may include linens, towels, and basic toiletries, as well as appliances and other amenities like a coffee maker, microwave, or television. You should also consider providing basic supplies like paper towels, trash bags, and cleaning supplies. The idea is to make the place as easy to use as possible while hopefully reducing cleaning and maintenance costs.

   We often would leave a bottle of wine along with a gift card to a local cafe for our guests if they booked more than a couple of nights. Small details like that can go a long way in differentiating your rental from others on the market and lead to better reviews. Remember, you guests are going to be some of your best marketers. Look for things you can do to make them smile, encourage them to write good reviews, or even design details that beg to be photographed and shared on social media.

6. Manage your Short Term Rental Finances and Pricing.

   To run a successful short-term rental property, you'll need to manage your finances and pricing carefully. This may include setting competitive rates, keeping an eye on competing rentals in your market, tracking your expenses and income, and keeping your property well-maintained to ensure that it stays in good condition and attracts guests. You should also be aware of any fees and tax implications of operating a short-term rental property and make sure that you are complying with all relevant laws and regulations. Although the potential income often sounds good, it is important to carefully estimate and plan for the costs you will incur running the business.

   Your Short Term Rental is not going to be purely passive income. It is a business and will take effort in order to be profitable. Make sure you develop a budget, track all expenses, and plan for bigger costs like repairs that only need to be done once in a while. As you develop a better sense of the costs of running the business, set your pricing and minimum nights stay to ensure that it is a profitable business.

7. How Much Income Can Renting an ADU On A Short Term Basis Generate?

   You can definitely make a decent living renting out an ADU on a short term basis. As you plan to embark on this endeavor think about how many vacant nights you will have, how many hours or days you need between stays to turn the place over, what seasons will have more demand, what pricing you should set at various times to attract enough reservations, and what your operating costs will be.

   For example, if you are only renting out the ADU on weekends - like we did - you only have about 100 nights a year you can rent out the place. And perhaps summer plus holiday weekends will have high demand but winter weekends may not be fully booked. Planning on renting 70 out of the 100 nights may be a good estimate to build a budget off of.

   If you are renting out the ADU for an average of $200/night you could generate $14,000 in revenue (You may charge higher rates, like $300/night in the busy season but lower rates in the off season). However, you would have to subtract cleaning services, supplies, and maintenance costs, plus any other expenses needed to run the rental.

   Alternatively, if you were renting it out full time and had a 70% occupancy rate that would give you 255 nights rented each year. At the same average nightly rate of $200 you could make around $51,000 in revenue. Of course this is just revenue and not profit, but still that could be a pretty decent income for a business that doesn’t take up your full time to manage.

8. Get Insurance for Your Short Term Rental and ADU

   Contact your current insurance provider to understand what coverage they provide for rental units on your property. Many home insurance policies won’t cover rentals so you probably will have to purchase supplemental insurance. Make sure that the policy you purchase will cover damages or accidents causes by guests and renters.

Overall, running a short-term rental property requires a combination of careful planning, business savvy , marketing strategy, and attention to detail. By understanding the laws and regulations that apply to your property, setting up a system for booking and managing reservations, developing a system for cleaning and maintaining the property, creating policies and procedures for guests, providing amenities and supplies, and managing your finances and pricing, you can successfully operate a short-term rental property and provide a comfortable and enjoyable experience for your guests and a steady income stream for you.

A short term rental business can take a lot of different shapes. If you already own a home and there is potential to add another unit, like a basement apartment, a converted garage, or a backyard guest house or ADU, that can be a great way to get your foot in the door and start earning rental income. One of reasons we think this is the best first step is that you already own the land so the startup costs can be much less than buying a new property. Not only that, adding an accessory dwelling unit can start generating monthly income now, but also increases your property value in the long run.

If you have any additional questions about adding an ADU as a rental unit on your property, or are thinking of building a small vacation home to rent out, feel free to reach out with any question or peruse our ready-made ADU plans that are downloadable today.

Building an ADU - What to know before you break ground

If you are considering building an ADU (accessory dwelling unit), there are several important things to consider before you break ground.

1. Research local regulations and requirements. ADU regulations and requirements can vary depending on the location of the property, so it is important to research and understand the specific regulations and requirements that apply to your property. This may include obtaining the necessary permits, meeting certain zoning and building code requirements, and following any other applicable regulations.

2. Determine the design of the ADU. The size and design of the ADU will depend on factors such as the size of the property, the intended use of the unit, and any local regulations or requirements. It may be helpful to work with a qualified professional, such as an architect or designer, to develop a plan that meets your needs and complies with local regulations. Alternatively, starting with a pre-designed ADU Plan can be an option to save time and money.

3. Consider the cost of construction and financing options. Building an ADU can be a significant investment, so it is important to consider the costs involved and determine how you will finance the construction. This may include securing a loan, using savings, or seeking financial assistance from a government program.

4. Choose a contractor. Once you have an ADU plan in place, you will need to choose a contractor to handle the construction of the ADU. It is important to research and compare contractors to ensure that you choose one that is qualified, experienced, and reputable.

5. Consider the ongoing maintenance and operating costs of the ADU. Once the ADU is built, you will need to consider the ongoing maintenance and operating costs of the unit. This may include costs such as utilities, property taxes, insurance, and repairs. It is wise to plan for this in advance and work with your designer or builder to select low-maintenance long-lasting materials and systems.

6. Set the timeline. Build and ADU takes a long time - months or even years depending on the size, complexity and location. Work with your general contractor to set a construction schedule and plan for any complexities and risks. Also plan some contingency as nothing works out exactly to plan.

7. Involve your designer throughout construction. Drawings are a guide for builders to follow but can never have every detail and situation covered. Having your designer involved in the construction process can help avoid errors, answer questions, work through challenges, and ultimately save money. It is always cheaper to make revisions on paper before things are built. When contractor’s have questions it is best to consult with your design team to help solve the problem. The design fees during construction will be much less than fixing things that were built incorrectly.

8. Hire a professional. Experienced designers and builders are more than worth their fees. They know how to get things done to a high quality and can guide you through the hundreds of decisions along the way. They also have relationships with other consultants that will be needed throughout the process. Although some people may be successful DIYing an ADU project, considering the amount of work it will take and time it will absorb, it is a great investment to hire professionals who can avoid mistakes, and keep the project on budget and on schedule.

Overall, building an ADU can be a rewarding investment, but it is important to carefully consider all of the factors involved before breaking ground. By researching local regulations, determining the size and design of the ADU, considering the costs involved, and planning for ongoing maintenance and operating costs, and hiring an expert team, you can ensure that your ADU project is successful.

5 Reasons ADUs Are A Good Investment

ADUs (accessory dwelling units) are becoming increasingly popular as a way to add additional living space to a property. These units, which are also sometimes called guest houses, laneway suites, granny flats, in-law units, or secondary units, are typically smaller than the primary residence on a property and are designed to be used as a separate living space.

There are many reasons why ADUs can be a good investment for property owners.

1. ADUs can provide additional rental income. By adding an ADU to your property, you can rent out the space to generate additional income. This can be especially useful for property owners who have a large amount of unused space on their property or who are looking for a way to supplement their income. The rental income can also help cover mortgage payments, making real estate purchases more attainable for a wider range of people.

2. ADUs can increase the value of your property. By adding additional living space, you are effectively increasing the overall square footage of your property, which can make it more valuable. This can be a particularly good investment for property owners who are planning to sell their property in the future, as the added value of the ADU can increase the overall value of the property.

3. ADUs can provide additional living space for family members or guests. This can be especially useful for aging parents or adult children who may need a place to live but do not want to be too far from their families or community. By providing a separate living space, ADUs can offer a level of independence and privacy for these individuals while still allowing them to be close to the rest of the family. It is also often a more affordable option than renting a room or apartment in a retirement community or assisted living facility.

4. ADUs can be a more affordable option for homeowners who want to add additional living space to their property. Because they are typically smaller than traditional homes, they can be less expensive to build and maintain. In addition, many cities and municipalities are now offering incentives and easing regulations to encourage the construction of ADUs, which can make them even more affordable. Further, since you don’t have to purchase the land, they are much more affordable than building a new home.

5. ADUs can be a sustainable housing option. By making use of existing resources and infrastructure, ADUs can be a more sustainable housing option than building new, standalone homes. In addition, ADUs can be built to be energy-efficient, which can help reduce the environmental impact of housing and save money on utility bills. Considering they are built on existing properties they also don’t require large infrastructure investments, which is a more sustainable development and saves money for town and city governments.

Overall, ADUs can be a good investment for property owners who are looking for additional rental income, want to increase the value of their property, need additional living space for family members or guests, or want to add living space in a cost-effective and sustainable manner.

Important ADU Investment Considerations

Of course, as with any investment, there are also some potential drawbacks to consider before building an ADU. One potential downside is that the construction process can be time-consuming and complex, especially if you are not familiar with local building codes and regulations. In addition, the cost of building an ADU can vary depending on factors such as the size of the unit, the materials used, and the location of the property. It is important to consult with a expert designer or builder as well as your local building department to better understand the full requirements of building an ADU.

Another potential downside is that the rental income from an ADU may not be enough to cover the costs of construction and maintenance. This is especially true if you are planning to use the ADU as a long-term rental property, as the costs of property management, repairs, and utilities can add up over time. It is highly recommended that you research the local rental market and compare what you could generate in rental income vss what the full construction and ongoing maintenance costs will be.

Despite these potential drawbacks, many property owners still find that the benefits of building an ADU outweigh the potential costs and challenges. By providing additional living space, increasing the value of your property, and offering potential rental income, ADUs can be a good investment for the right property owner.

If you are considering adding an ADU to your property as an investment, here is some guidance on how to begin:

AIA NY Advocates to Legalize ADUs Across New York State

It is great to see that ADUs are being recognized in states across the country as one of the ways to help address our housing shortages. I also respect that AIA NY is advocating to legalize these housing types state wide.

Let’s hope that this advocay in conjunction with other groups and individuals pushing for legislative change is successful. ADUs make sense in all sorts of conditions, from larger cities to small towns and even rural settings. Whether it is an internal rental unit - like a basement apartment - or a detached ADU like a guest house or rental unit, ADUs provide additional housing, rental income, increased property values, and opportunities for multi-generational living, aging-in-place, downsizing, or just some extra space.

We firmly believe that ADUs should be legal everywhere. They are a great way to add new housing options, allow for a range of living situations, but also make real estate more affordable for a wider range of people.

Read the article about legalizing ADUs from AIA NY:

https://www.aiany.org/news/legalizing-accessory-dwelling-units/

Is an ADU a Good Investment?

Whether an ADU (accessory dwelling unit) is worth the investment will depend on a variety of factors, including your specific circumstances, the local real estate market, and the costs and benefits of building an ADU. In general, we have found that they have been great investments for most of our clients.

There are several potential benefits to building an ADU, including:

• ADUs Provide Rental Income:

  An ADU can provide a source of rental income for property owners. By adding an ADU to their property, property owners can rent out the space to generate additional income. This can be especially useful for property owners who have a large amount of unused space on their property or who are looking for a way to supplement their income and help pay down their mortgages.

• ADUs Increase Property Values:

  An ADU also increases the value of your property. By adding additional living space, property owners are effectively increasing the overall built square footage of their property, which can make it more valuable. This can be a particularly good investment for property owners who are planning to sell their property in the future, as the added value of the ADU can increase the sales price when they are ready to sell.

• ADUs Are A More Affordable Housing Option:

  ADUs also provide a more affordable housing option for homeowners who want to add additional living space to their property. Because they are typically smaller than traditional homes, ADUs can be less expensive to build and maintain. This can be especially appealing for homeowners who want to add a separate living space for family members but want to save money compared to purchasing a full house.

However, there are also several potential drawbacks to building an ADU, including:

• Initial ADU Cost:

  Building an ADU can be a significant investment, as it requires the purchase of materials, labor, and any necessary permits and fees. This initial cost can be a significant financial burden for some property owners and/or require construction loans or refinancing of the main house to cover those costs. It is important to balance the cost with potential income or increased property values. Overall, we see most detached ADUs starting at an investment of around $200,000 or more. Check to see if rental income in your area will offset the initial investment and make it worth pursuing. In most larger cities rent is high enough to make it a good investment despite the initial costs of ADU construction.

• Ongoing ADU Costs:

  In addition to the initial cost of building an ADU, there may also be ongoing lifecycle costs associated with maintaining the unit, such as utilities, insurance, and any necessary maintenance and repairs. These costs should be considered when evaluating the potential profitability of an ADU - balancing these costs with potential rental income.

• ADU Zoning and Legal Issues:

  Depending on the location of the property, there may be local zoning laws or other legal restrictions that impact the ability to build an ADU or what you can do with it (for instance many cities ban renting ADUs as short term rentals like Airbnb). It is important to research and understand these laws and regulations before embarking on an ADU project.

Overall, whether an ADU is worth the investment will depend on a variety of factors and should be carefully evaluated on a case-by-case basis. However, in our experience most ADUs are excellent investments for homeowners as the potential rental income plus the increase in property values more than offsets the upfront and lifecycle costs.

If you are considering adding an ADU as an investment and have any questions don’t hesitate to reach out. We love helping people embark on their ADU journeys. And if the goal for your ADU is as an investment, starting with a pre-designed ADU plan can help you get off on the right foot and reduce the development costs by saving on design fees and time.

Artificial Intelligence: ChatGPT and ADUs

Fascinating times we live in. I’ve been playing around with some new tools that have been released that use artificial intelligence to create images and text from simple text-based prompts. The results are impressive. The question now is how to best utilize these tools within our typical workflow.

How can we use AI image generation to help us with the design process or visualize our ideas for clients to see?
How can AI help us write better, or market our products?

For example, here is a block of text the new AI chatbot ChatGPT generated using the prompt shown below:

Prompt:

Write marketing copy about selling pre designed ADU plans

Response:

Are you tired of the endless back and forth with architects and contractors trying to bring your ADU vision to life? Look no further! Our pre-designed ADU plans offer a cost-effective and efficient solution to your accessory dwelling unit needs.

Our plans are carefully crafted by experienced architects and are designed to meet all necessary building codes and regulations. They include detailed floor plans, elevations, and specifications to ensure a smooth building process.

Not only do our pre-designed plans save you time and hassle, but they also offer a unique and stylish option for your ADU. Choose from a variety of modern and contemporary designs to find the perfect fit for your property.

With our pre-designed ADU plans, you can bring your dream of additional living space to life without breaking the bank. Don't waste any more time and money on complicated and time-consuming custom design processes. Invest in one of our pre-designed ADU plans today and start building your dream accessory dwelling unit tomorrow.

Not bad. There are some things that I would revise slightly, but overall it is pretty compelling marketing copywriting considering it literally took about 10 seconds to write the prompt and get a response. Rather than spend hours working with a writer, or crafting language myself, this tool created good results in seconds. This could be game changing for so many industries.

Another example of AI generated writing:

Prompt:

What is an ADU?

Response?

An ADU, or accessory dwelling unit, is a small, separate living space that is attached or detached from a primary residence. ADUs are also known as granny flats, in-law units, backyard cottages, and accessory apartments. They are typically used as additional living space for family members, guests, or renters. ADUs can provide additional income for homeowners, as well as increased housing options in urban areas.

Again, a pretty good written response within seconds.

One more, asking the AI Chat program the most common ADU question:

Prompt:

How much does an ADU cost?

Response:

The cost of an ADU can vary depending on a number of factors, including the size of the unit, the materials used, and the location. In general, however, the cost of building an ADU can range from around $100,000 to $300,000 or more. Some factors that can affect the cost of an ADU include:

- The size of the unit: The larger the unit, the more it will cost to build.
- The materials used: The cost of building an ADU can be affected by the type of materials used. For example, using high-quality materials like stone or hardwood can increase the cost, while using more affordable materials like vinyl or laminate can decrease the cost.
- The location: The cost of building an ADU can vary depending on the location. In urban areas, where land is more expensive, the cost of building an ADU may be higher. In rural areas, where land is cheaper, the cost may be lower.
- The complexity of the design: A more complex design may require more materials and labor, which can increase the cost of building an ADU.

Overall, the cost of building an ADU can vary widely, so it's important to consult with a professional and get an estimate before starting the building process.

Although I think their range is a little low based on today’s construction costs, this is a pretty good answer. It is also important to note that the AI is using slightly old information (I believe from 2021 based on a NYT article), but should improve over time.

Overall, I’m incredibly impressed by this tool and potential for AI to benefit our workflow. Writing is just one application. Another tool that I’ll write about in a separate post focuses on AI generated imagery. Midjourney takes similar text-based prompts but instead of creating written responses it generates digital images. I’ve played around with it a bit and have been impressed with the results. I’ll be sharing some of my experiments with that tool in another post.

White House Event on Making it Easier to Build Accessory Dwelling Units (ADUs)

It is clear that ADUs are growing into the mainstream of housing conversations when the White House starts discussing ways to make it easier to build accessory dwelling units across the country.

There were some excellent speakers, including Robert Liberty who I did some work with while living in Portland. My only criticism is it would have been nice for them to include some designers who specialize in these units to talk about design considerations as well as some of the hurdles we experience turning ideas into built homes.

On February 1st, 2022, the White House hosted a virtual event on making it easier to build accessory dwelling units (ADUs). Featured speakers included:

• Ambassador Susan Rice, White House Domestic Policy Advisor

• Sandra Thompson, Acting Director, Federal Housing Finance Agency

• Lopa Kolluri, Principal Deputy Assistant Secretary, Office of Housing and the Federal Housing Administration, Department of Housing and Urban Development

• Mike Hernandez, Vice President Engagement & Impact, Fannie Mae

• Mayor Miro Weinberger, Burlington, Vermont

• Denise Pinkston, President, The Casita Coalition

• Karen Chapple, Professor Emerita of City & Regional Planning, University of California at Berkeley and Director of the School of Cities, University of Toronto

• Kevin Skinner, EVP, Head of Home Lending, Umpqua Bank

• Noni Ramos, CEO, Housing Trust Silicon Valley

• Robert Liberty, Strategic Partner, Cascadia Partners

• Rodney Harrell, Vice President, Family, Home and Community, AARP Public Policy Institute

• Tom DeSimone, President & CEO, Genesis LA

Bainbridge Island Accessory Dwelling Unit Regulations and Code Requirements

If you own a property on Bainbridge Island, and are considering adding an ADU, here is what you need to know from a zoning perspective.

Can I build an ADU on Bainbridge Island?

The good news is ADUs are allowed as an accessory use on almost all residentially zoned properties. This means you don’t need any additional permissions or Zoning adjustments. As long as the design meets the regulations no special approvals will be necessary. This is great as many cities have been slow to adopt ADU codes.

What types of ADUs are allowed?

Accessory Dwelling Units on Bainbridge Island can be either detached, stand-alone units, created within an existing home (a basement conversion for example), and can even be built over a garage. My personal recommendation is that detached ADUs are the best option for most properties, although we have designed all sorts of ADUs over our career. ADUs over garages are a great way to add a rental unit without taking up too much land and have been very popular.

How many ADUs can I build on my property on Bainbridge Island?

The Bainbridge Island ADU code does have a one ADU per property limit. This means that if you convert your basement into an accessory dwelling unit you won’t also be allowed to build a detached ADU. I think this is unfortunate as many other cities, including Seattle and Portland, allow multiple ADUs - for instance, a basement ADU and a detached ADU. Hopefully Bainbridge Island will reconsider this limitation as they work to increase housing options and affordability. I think allowing a basement ADU plus a detached ADU would be a great code change.

Do I need to provide parking for the ADU?

Providing parking is another requirement when adding an ADU to your Bainbridge property. At least one off-street parking space must be provided for the ADU tenants. They also must share the driveway with the main house - meaning you can’t have two separate driveway entrances.

What is the size limit for ADUs on Bainbridge Island"?

There are a few other requirements, although they are mostly targeted at detached ADUs. The size of ADUs are limited to 900sf or less, and they must meet all of the zoning requirements of the overall property (such as setbacks, lot coverage, etc.) Of note, if ADUs are built in the same structure as a garage the garage doesn’t count against the 900sf limit. Stairs within the ADU also don’t count against the size limitation. Also, if you are making an ADU in your basement the City will allow the ADU to be larger than 900sf if it is filling the existing basement space.

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Here is the exact language from the Bainbridge Island Municipal Code, Title 18 Zoning, Chapter 18.09 Use Regulations:

Accessory Dwelling Unit.

a. An accessory dwelling unit (ADU) may be created within, or detached from, any single-family dwelling, whether existing or new, as a subordinate use, where permitted (“P”) by this chapter.

b. In the shoreline jurisdiction, an accessory dwelling unit may be created within, or detached from, any single-family dwelling, whether existing or new, as a subordinate use, where conditional (“C”) pursuant to this chapter. See Chapter 16.12 BIMC for shoreline conditional use process.

c. Only one accessory dwelling unit may be created per parcel.

d. No variances shall be granted for an accessory dwelling unit.

e. One off-street parking space shall be provided in addition to off-street parking that is required for the primary dwelling.

f. Accessory dwelling units shall be designed to maintain the appearance of the primary dwelling as a single-family dwelling, containing 900 square feet of floor area or less. However, if the accessory dwelling unit will be located within a building existing as of the approval date of Ordinance No. 2015-16 (for example, in a basement) the city may allow an increased size in order to efficiently use all floor area. If a separate outside entrance is necessary for an accessory dwelling unit located within the primary dwelling, that entrance must be located either on the rear or side of the building.

g. If an accessory dwelling unit is constructed in conjunction with a garage, the square footage of the garage shall not count towards the 900-square-foot limitation.

h. An accessory dwelling unit not attached to the single-family dwelling may not contain any accessory use other than a garage.

i. No recreational vehicle shall be an accessory dwelling unit.

j. When stairs utilized for the ADU are enclosed within the exterior vertical walls of the building, they shall not count towards the floor area of the ADU.

k. The ADU shall share a single driveway with the primary dwelling.

l. School impact fees and qualified exemptions from those fees as provided in Chapter 15.28 BIMC shall apply.

m. All other applicable standards including, but not limited to, lot coverage, setbacks, parking requirements, and health district or city requirements for water, sewer, and/or septic must be met.

n. In the Mixed Use Town Center, new accessory dwelling units are only permitted as part of a housing design demonstration project single-family subdivision approved pursuant to BIMC 2.16.020.S.

How to Increase Storage in Small Homes and ADUs

Building an ADU, or backyard cottage on your property can be an ideal source of additional income. But maximizing that income and ensuring it stays steady means designing and building a space that tenants want to live in. Investing up front in small details, including providing ample storage, can create a more appealing living situation and may even allow you to raise your rental rates.

Consider these ideas for increasing small-space storage in your ADU:

Don’t Neglect the Closets

The more a tenant can put items “away” the more their space can feel clean, uncluttered, and spacious. Closets shouldn’t be an afterthought for ADUs and shouldn’t be considered a place to skimp or save space. Ensure there is a closet in every bedroom and ideally an additional linen closet, pantry, or coat closet. If there simply isn’t room, add a beautiful armoire in the bedroom to provide hanging space. Using nice furniture items can be a great way to supplement the built-in storage and contribute to the interior design of the accessory dwelling unit.

Use Vertical Spaces

Walls are the perfect spot to add extra storage, but tenants might be nervous about adding these items themselves for fear of damaging the walls. In the kitchen, consider built-in spice or knife racks, pot hangers, or simple floating shelves. In the living room or bedroom, floating bookshelves add space and are less bulky than furniture. Our Home Office ADU plan is only about 500 square feet, but offers discreet storage with built-in shelving and cabinets above the bed and modern floating shelves in the kitchen. We also included a small linen closet and access to the attic space over the bed nook for addition storage space. Coupled with ground floor vestibule with additional closet, this small ADU accommodates all the things most renters will want to store away. 

Install Shelves Above the Toilet

An additional vertical space to remember is the wall above the toilet, which is commonly wasted but provides a perfect place to install shelves in a bathroom without room for a linen closet. 

Maximize Under-Stair Areas

For two-story units, or units above a garage, make use of the under-stairs space on the exterior—and ensure it’s accessible for the tenant—for storing bikes, garden tools, and other outside items. Be thoughtful about wiring, water heaters, and other utilities in the space so the area isn’t wasted. If there are interior stairs, the space underneath is great for utilities like water heaters or even built-in washer and dryers. We have even seen nice home bars designed for the space under stairs. At the very least, make this space available as a small closet or cabinet. 

Create a Mini-Mudroom

More and more Americans prefer to take their shoes off before entering the home. Creating a built-in bench or shoe storage area with small shelves and hooks above can be more efficient than leaving shoes haphazard in the entryway. This is especially necessary if there isn’t room for a coat closet. If going with a bench in the entry, find one that can open and provide storage space. There are some bench products that include storage or you can have your designer create a custom built-in storage bench. 

Add an Outdoor Shed

One of the reasons renters choose an ADU over a traditional apartment building is to hopefully have some outdoor space. This is also an opportunity for a small bit of outdoor storage. A simple outdoor shed can provide space for emergency supplies such as extra water, outdoor tools, car supplies, and other extras, which are often hard for apartment dwellers to store, making them feel less prepared than homeowners. Best part? Adding a small shed takes no space away from your interior footprint. For tenants who love outdoor activities like biking, camping, kayaking, etc. an outdoor shed would be an amenity that can set your ADU rental apart from the competition and lead to higher rents or longer-term tenants. If your ADU is in places like Oregon, Washington, California, Colorado or other places with a big outdoor adventure culture, providing an outdoor shed for your tenants is highly recommended!

Make Use of Every Opportunity

If you’ve ever rented an RV or toured a boat, you likely noticed that every available space is maximized. You need to think similarly with your ADU. Take a step back and truly look at the space—what areas are wasted that could be put to use? These might include space above the kitchen cabinets, an oddly-shaped foyer, or an out-of-the way corner. For example, in our Backyard Oasis ADU floor plan, narrow cabinets installed next to the refrigerator are the perfect spot for storing brooms, baking sheets, and other awkward items. 

Ready to talk about building your ADU? Browse our ADU plans here or contact us for a consultation.

Why ADUs are Great For California

ADUs (accessory dwelling units) are becoming an increasingly popular housing option in California, and for good reason. There are many benefits to ADUs in California, both for property owners and for the state as a whole. Here are just a few:

1. California ADUs can provide affordable housing options.

   California has a well-documented housing crisis, with high housing costs and a shortage of available units. ADUs can provide a more affordable housing option for individuals and families who are struggling to find affordable housing. Because they are typically smaller than traditional homes, ADUs can be less expensive to build and maintain, making them a more accessible option for many people.

2. ADUs can increase the supply of California housing.

   By adding additional living space to existing properties, ADUs can help increase the overall supply of housing in California. This can help alleviate the pressure on the housing market and make it easier for people to find a place to live.

3. ADUs can provide additional rental income for California property owners.

   By adding an ADU to their property, property owners can rent out the space to generate additional income.

4. ADUs can provide additional living space for family members or guests.

   This can be especially useful for aging parents or adult children who may need a place to live but can’t afford market rate rents. By providing a separate living space, ADUs can offer a level of independence and privacy for these individuals while still allowing them to be close to the rest of the family.

5. ADUs can be a sustainable housing option.

   By making use of existing resources and infrastructure, ADUs can be a more sustainable housing option than building new, standalone homes. In addition, ADUs can be built to be energy-efficient, which can help reduce the environmental impact of housing and save money on utility bills.

Overall, ADUs can provide a range of benefits to California, including increasing the supply of affordable housing, providing additional rental income for property owners, and offering additional living space for family members and guests. In addition, ADUs can be a more sustainable housing option, which can help California meet its goal of reducing greenhouse gas emissions and promoting sustainable development.

ADUs as Affordable Housing

For many people, the dream of owning a home is becoming harder and harder to achieve. But there is one solution that could provide more affordable housing options: ADUs. ADUs, or accessory dwelling units, are small apartments or homes that can be attached to or built beside a primary residence. And they could be part of the solution to our affordable housing crisis. They go by many names including: backyard cottage, carriage house, guest house, or even mother in law suite or granny flat. Regardless of what they are called these provide an opportunity to create new homes in our communities and provide affordable places for people to live.

There are many benefits of ADUs. They provide more affordable housing for homeowners, help seniors stay in their homes longer, and create more opportunities for shared living arrangements. They can also be an important source of income for property owners, often allowing people to afford to purchase their first home. We have found that there are three primary reasons people have come to us to start their ADU projects: building a rental unit to generate income and increase their property value, create a place for an aging family member to live, or to downsize their home while staying in the neighborhood they love while renting out the main house.

Policy

Beyond homeowners, many towns, cities, and states are looking at ADUs as one piece of the puzzle to address some of the housing issues facing our communities. Governments are enacting new policies to allow ADUs by right, make ADUs easier to permit, and open up new opportunities for ADUs to be added to a wider range of properties. These policies take many shapes from zoning code updates to incentives for homeowners to build ADUs. Some places, like Oregon, Washington, California and other states have passed laws to allow ADUs on any residential properties state wide. In California, they have taken a further step to try to make ADUs more affordable to build by providing grants for homeowners to help cover some of the costs of designing and permitting these projects.

Beyond the states that have already adopted ADU specific codes and regulations, many states are actively working on implimenting new policies to allow accessory dwelling units. New York State has a bill going through their legislature that would legalize ADUs statewide - mandating that each town/city/county add code language that allows ADUs. While many cities across the country are also adding ADU language to their zoning code.

It is clear that these projects are growing in popularity and our government representatives are hearing from homeowners in their jurisdictions who want more flexibility to add ADUs to their properties.

Affordable Housing

Although ADUs can be naturally affordable regardless of who builds it since there is no cost for the land, they are also becoming a tool governments and non profits are using to create subsidized affordable housing. For example, Portland, Oregon is allowing more than one ADU per property if one of the units is designated as a permanently affordable rental unit. This incentive is encouraging developers and homeowners to build subsidized affordable units.

Many affordable housing non-profits are also looking at ADUs as a way to increase their housing portfolio. Often community development corporations own single family homes and rent them out below market rate. ADUs allow them to add additional units to these residential properties, creating new affordable units.

There has also been experiments where cities or counties have financed the construction of ADUs on private properties, using these units as affordable or transitional housing for a set period of time, after which the land owner will own the ADU. Basically, a homeowner donates the land for a fixed time period - often around 10 years - and the city builds the ADU and offers it to someone in need. After the time period is up, the landowner takes ownership of the ADU and can rent it out themselves. This is an intriguing way to incentivize the creation of ADUs as affordable housing while making it accessible to those that may own a property but don’t have the capital or access to financing to build an ADU on their own.

Naturally Affordable

One of the best aspects of ADUs when it comes to creating affordable homes is that the land isn’t a development cost. Since homeowners already own the land, adding an accessory dwelling unit only costs the fees associated with design, permitting, and construction. This makes them naturally affordable compared to most other types of housing.

Rental Income Can Make Housing More Affordable

The other big benefit of ADUs is they can make purchasing a home more affordable for more people. If you are a young professional looking to purchase a home, finding a property with an ADU that you could rent out, could allow you to afford a property you may otherwise not have been able to. Or if you can look at properties that could easily add an ADU - like renovating the basement into a JADU or it has a backyard that could accommodate a detached unit - you may be able to stretch your budget knowing you could create another unit that would generate rental income to help offset the mortgage expenses.

Financing

Building an accessory dwelling unit is not cheap. They are significant investments and can easily cost hundreds of thousands of dollars. Financing for these projects typically takes the form of home equity line of credits or cash-out refinancing for those who don’t have the cash on hand to cover the cost of design, permitting, and construction. However, this isn’t available to every homeowner out there. Most lower or middle class families don’t have the cash available or the equity in their properties to cover the cost of an ADU.

This challenge is another place that governments and non-profits are working to address to make more ADUs and thus add affordable homes. Places like California are introducing a grant program to cover up-front soft costs for ADUs. Other places are working on creating public-private partnerships to allow more diverse loan options to help finance these projects. And like we mentioned above, some governments are even covering the cost of building the ADU in exchange for using the ADU as affordable housing for a set period of time.

It is important that more attention is paid to how much these projects cost and ways to make the money necessary to build ADUs more accessible to a wider range of homeowners. I personally would love to see it possible to finance ADUs through a typical construction loan or mortgage product.

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New Construction ADUs vs Garage Conversion ADUs

We frequently get contacted by people looking to add a wide range of ADUs types, but the two most common are new construction detached ADUs, and Garage Conversion ADUs. This seems to be the case in almost every town and city that allows accessory dwelling units. People who have garages in place think converting them to a rental unit would be a great option. While others hope to build an detached ADU in their backyards. Here we will discuss some of pros and cons of both of these ADU types and ultimately why we recommend going with new construction rather than converting garages for most properties.

New Construction ADUs

Ease

If you are thinking of adding and ADU to your property, Detached ADUs (sometimes shortened to DADU) are by far the easiest path forward. It is always more challenging to work within existing conditions and going with a detached ADU also gives you the most flexibility with the design and layout. New construction allows the design team to respond to the unique aspects of your site and the specifics of what you want your ADU to look like and accommodate. It is the easiest option for designers and builders and probably the best option for you to get exactly what you want.

Quality

Today’s construction techniques and consideration of modern building science can give you a high quality ADU that is efficient and sustainable. In almost all cases this will result in a higher quality project than working within an old garage that probably wasn’t built to today’s codes or standards. From increased insulation, to tighter building envelops, building new will give you the highest quality end result.

Flexibility

Alluded to in the ease section above, detached ADUs often give you the most flexibility when it comes to size, height, form, and layout. They can be designed custom for your property and the end use of the ADU. The size isn’t restricted to fitting within an existing structure so is only limited by the local regulations for ADU size. Same for style. Detached ADUs can range in style from traditional to modern and designing a custom detached project gives you the most flexibility.

Cost

Many people will say that you can save money by converting an existing structure rather than building new. Although this may be the case in some specific circumstances, for the most part we have found that the cost often ends up the same and sometimes conversions actually cost more. It is complicated working within existing spaces, and often there are specific requirements to bring older structures up to today’s codes, which can be incredibly costly. Making sure that the foundations are sound, insulation requirements are met, and utilities can reach the right locations can be much harder when working within an old garage or basement. Building a new construction detached ADU could potentially be a more affordable option.

Start with a Pre-Designed ADU Plan

With a detached ADU you have multiple options for how to move forward with the design. You have the option of going with a fully custom design that is specific to your needs and property. You also could start with Pre-Designed ADU Plans like the ones we sell on this site. This option could save you a lot of time and money. ADU Plans aren’t right for everyone, but if you are looking to keep cost down and are willing to stick to the designs available it could be a great option.

Increased value

Converting existing space, be it a garage or basement, doesn’t really add more usable space to your property. In many cases it is replacing one use with another - you may gain a rentable unit but lose storage or parking. To maximize the increased property value of adding an ADU a new construction detached ADU may be the best option. It gives you a new asset while maintaining the use of those other spaces. Further, depending on the jurisdiction you may be able to add a detached ADU as well as convert a basement into a JADU, giving you three units on one property. Our point here is that adding a detached ADU gives you the most potential to maximize the use of your property and increase the value.

Garage Conversion ADUs

Complex

Converting existing spaces is complex as you are constrained by space and access. It is harder to achieve structural requirements like seismic bracing or energy code requirements for insulation as two examples. Often these and other requirements result in almost rebuilding the whole structure, negating any potential savings. In other cases, conversions may be more labor intensive for things like foundation repairs or slab demo and re-pours than they would be on a new construction project. The added labor cost often negates any potential savings of using the existing structure to reduce material costs. Both the design and construction of garage conversion ADUs are complex and typically more complicated than most people assume when the consider this option.

Limited size

If you are going to invest a significant amount of money on an ADU project, it makes financial sense to maximize the size. You will get a greater return on the investment with a larger ADU - either through increased rental income or higher property value increase. However, converting a garage inherently limits the size of your ADU as you are stuck working within an existing footprint. Further, garage dimensions are set to be an efficient way to park a car, not as an efficient use of space for living. One car garages can maybe fit a tight studio apartment while a two-car garage could potentially accommodate a one bedroom unit. However, both are limiting in terms of potential use and rental potential. You will get a better layout and more space if you skip the conversion and just go with a detached new construction ADU.

Cost

As discussed above, but worth repeating here, we have found through years and years of experience that converting garages are not nearly the savings that most people assume. Most garages are old and in disrepair. Very seldom are the siding or roof worth keeping and most often the foundations and slab are not up to codes for living spaces. Working within an existing structure can also dramatically increase the labor time as it limits access for machines and equipment. Once you factor in all the required upgrades and code requirements it often means you are basically rebuilding the whole structure anyway, but arbitrarily limiting the size and footprint of your ADU. And the fees for doing a custom design would be higher than if you started with pre-designed plans for a detached ADU. The cost savings, if there is any at all, is not worth the limitations.

Custom design

You can’t do pre-designed solutions for garages or other conversions. There are too many custom requirements and details needed that you will have to hire a design team to do a custom solution. This eliminates the ability to use pre-designed plans. Although custom design often can lead to the best result for the specifics of your property, it is definitely a more expensive path than starting with an ADU design that is already completed.

Property value

By converting a garage you gain an ADU but in the process you lose a garage. Overall this may end up adding some value to the property, but you are subtracting one asset to add another. To maximize the value of the property it is better to add a new ADU.

Our Recommendation

Based on almost 10 years of experience working on ADU projects, we have some strong opinions on the best way to get a high quality project. For most people going with a new construction ADU will give you the best result. New Construction offers the most design flexibility to get what you want, it can add the most value to your property, and it can lead to better quality construction and a higher performance building. Although for some properties a garage conversion may make sense or may be the only option, for the vast majority of people looking to add an ADU to their property, we highly recommending choosing to go with a new construction Detached ADU, whether it is a predesigned ADU Plan or going with a fully custom design.

The Butterfly ADU is tucked behind a house on Bainbridge Island, across the sound from Seattle, Washington. The detached ADU was customized to take advantage of views over the backyard garden, preserve privacy between the ADU and main house, and is sited to allow for solar panels to be added to the south facing roofs.

Design Process: Additional Services

We have outlined the general phases of the design process in earlier posts. However, there often are other services that we offer to make your project easier to achieve. None of these are required to get an ADU designed, permitted, and built, but some can make your project a greater success or take some work off your plate so you can focus on other things. Additional services for ADUs or Custom Homes allow us to customize the service offerings to the unique needs of each client and each project.

Property Search and analysis (Feasibility Study)

You are looking into buying a new home and want to know what the potential is to add an ADU as a rental unit. Or perhaps you want to analyze your current property to better understand the opportunities and challenges for adding an accessory dwelling unit or other property improvement project - like a major addition, remodel, or even a new custom home design. It is also a great idea to do a feasibility study when considering purchasing of a piece of land. If you are considering any of these options a feasibility study is highly recommended as the first step. Whether you hire us or engage another design team, it is worth investing in this preliminary research before you commit to a larger project or before you close on a property purchase. Zoning research, site analysis, property review, and other research is can save significant money or prevent you from beginning a project before knowing exactly what is allowed. Whether you are considering an ADU, a major remodel, or a custom home design, this is a valuable service that is worth the upfront investment.

Interior Design

Some clients love shopping for materials, finishes, appliances, and picking out colors and other interior elements for their homes and ADUs. Others don’t have the time and want someone to assist with this process. Since most interior finish selections don’t affect the permitting process this service isn’t necessary to get a custom home or ADU approved to build, but it can make a big difference for the look and feel of your project. An interior design that matches the aesthetics of the exterior and creates a welcoming environment can make or break your project. And interior design is especially important if you are planning to rent out the ADU as a long or short term rental. You want durable materials and finishes as well as a noteworthy, photogenic design that will set your rental apart from the competition. This service can include selecting all of the finishes like tile, counters, cabinets, fixtures, and hardware or can include additional tasks like helping select furniture, artwork, and other decorations to bring the space together and feel warm and inviting. Custom home and ADU Interior Design can take a great deal of time and effort but can have a great return on investment. This is why we recommend that our clients hire a professional designer to assist with this work. Typically we like to work with you to at least select all of the materials, finishes, and fixtures that will be attached to the structure which is why we offer interior design as an additional service for our ADU and custom residential clients.

Existing Conditions Drawings (As-Builts)

Most of the projects we work on are detached new construction ADUs or custom residences. However, when an ADU interacts with an existing structure on your property it is necessary to document the existing conditions. Often these are called as-built drawings, and include creating dimensioned drawings of all the existing spaces and structures that will be affected by the project. Most designers will offer this service or sub-contract it out to another drafting company. It is worth the investment to get an accurate drawing set that shows the current conditions of your home before you start any project.

Renderings

Three dimensional views of the project are another part of the design process that isn’t necessary for the permit approval process but can be a great tool to make design decisions. Taking these views a step further, you can use modeling and drawing software to create rendered views that show materials, finishes, lighting, furniture, people and other effects to really show what the spaces will look and feel like. We often do a couple exterior and a couple interior renderings so our clients can see an approximation of what their project will look like after it is finished. This allows them to have the confidence they will like the final design prior to starting construction. Good renderings do take time and thus cost money, but we always find it is worth spending a bit of extra effort during the design phase to prevent changes or worse, regrets, once construction begins. A couple thousand dollars during design can save tens of thousands during construction. If you are unsure about what your project will look like or how the interior spaces will feel by looking only at plans, sections, and elevations, ask your design team to make some renderings. It is an added service but can give you a better sense of the final project plus are great to share with friends and family so they can see what you are planning!

Physical Models

These are pretty rare these days as most firms have moved to digital drafting and 3D visualization software. However, some clients think better when seeing a physical model of their new home or ADU. We have built a few models for clients and they can be a valuable tool to help make design decisions. They can be time consuming if you are looking for a lot of detail. Simple massing models, or chipboard diagrammatic models can be quick and cheap, but detailed wood models can be very time consuming and could add significant cost to the design process. Still, like with the renderings, it is still cheaper to invest in the design process than try to make changes once construction begins. It is better to be sure about the design direction and sometimes physical models are the best way to think through a design challenge or capitalize on an opportunity.

Meetings and Presentations: Design Review, Community Engagement, Neighborhood Associations, Historic Review, and other meetings or presentations.

Certification Process & Applications: LEED, Earth Advantage, Passive House, Net Zero, or other certifications.

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Other Articles in Our Design Process Series:

1. Phase I - Predesign

2. Phase II - Schematic Design

3. Phase III - Construction Documents

4. Phase IV - Permitting and Bidding

5. Phase V - Construction Administration

Design Process: Phase 5 - Construction Administration

It is common to think that when the approved permits are in hand and construction can begin, that the services of a designer are no longer needed. Hopefully this post convinces you otherwise. I would argue that designer’s involvement in what is called Construction Administration, is one of the most important and valuable aspects of our services. This is why we don’t take on projects that don’t have a base level of services during the construction phase. It is the only way we can best serve our clients and work together with the contractor to deliver a high-quality project that meets the design intent.

What is construction administration?

Construction administration, often abbreviated as “CA,” is a series of meetings and administrative tasks that the designer undertakes to help oversee the construction phase of the project. The goal is for us to help the general contractor interpret the construction documents correctly, translate these design drawings into the built home, and troubleshoot any problems or situations that may occur. We work closely with the contractors and clients to help deliver a high-quality end result.

Typically CA work includes regular meetings on site with the contractor and owner. Often these are at regular interviews like monthly or weekly site meetings, while on some projects we may select key times to do site visits based on the construction schedule - like before pouring concrete, after framing is complete, before drywall is hung, etc.

Is Construction Administration worth the added cost?

Too often clients think that they will save money but declining to have the designer involved in the project once the permitted plans are received. They see CA as an added cost rather than an integral part of the designer’s services. Perhaps they see this as saving money to keep project costs down. However, construction administration is not an added cost and more importantly it can save thousands of dollars and help keep your project on budget.

A basic level of CA is included in our design fees for every project and isn’t a service that can be declined. Once a project breaks ground using our design drawings we must remain involved for liability reasons as well as to allow us to help deliver a project that meets our client’s expectations. As most designers and contractors already know, it is rare that a set of plans is perfect with all of the details, specifications, and information perfectly coordinated with the existing conditions on the site. There are always unexpected changes, alterations, and various interpretations that are needed to be clarified when translating two dimensional drawings into a three dimensional building. Not only are the drawings not perfect, but often clients make last minute decisions or changes that may affect the permitted drawings, or the construction process. We are there to help work through these, minimize delays, and get any additional approvals needed to continue the work.

Designers work to help resolve issues, work through design revisions, and solve unexpected construction hiccups. It is always easier and cheaper to make changes on paper, before you build something in the field. Having the designers available to work through detail drawings, find replacement material selections, or work with the clients to make last minute design changes can save thousands of dollars and help keep the project on schedule.

What are the tasks that designers perform as part of construction administration?  

Along with the site meetings we briefly mentioned above, designers also take on some administrative tasks and help communicate important information to the General Contractors building your project.

Let’s start with expanding on site meetings. Typically we want to schedule regular monthly meetings on site with the General Contractor to observe progress and get ahead of the construction process by answering questions and providing any additional information the builders may need that isn’t in the drawings. These meetings typically take an hour or two as we go over what work has been complete, what work is scheduled for the upcoming month of work, and what information the contractor needs to keep the project on track.

Beyond the site meetings, the designer is on call to clarify questions or provide additional drawings or information. Called Requests for Information (RFIs), the General Contractor makes formal requests for information from the design team. Depending on the request, the designer may create new drawings or revise the existing ones and coordinate any changes to the approved permit drawings if a major revision is needed. Revisions may need to be resubmitted to the building department so it is important to include the designer if any deviation from the originally permitted design is made while building.

Why can’t the builder manage the construction administration process? 

The builder’s role is to take the permitted construction documents and turn the drawings into the built project. However, they are only translating the drawings and haven’t been thinking through the design and code issues for as long as the design team. At this point we have probably spent 6-12 months with the clients, working through different ideas, laying out the ideal floor plans, selecting the materials, and developing the details needed to give the contractor the right directions on what to build, and also to obtain permission from the local jurisdiction. The insight designers have from this long process is not something the contractors can replace. They also are not trained in design or how best to address code requirements or functionality of design decisions. The builder is contracted to construct what is shown on the drawings. Any changes or deviations from the drawings must be discussed with and approved by both the designer and the client before the builder can move forward with the changes.

Some contractors may argue that they can fulfill the role of designer as needed during construction. However, these aren’t contractors we would recommend for your project or who we will work with. The delivery of a high quality project necessitates collaboration. It is vital that the clients, design team, and construction team work together. We each bring different skill sets, expertise, and concerns to the table. It is only have having everyone involved will the project be a great success.

Final Thoughts on Construction Administration for ADUs and Custom Homes

By the time construction begins you have invested hundreds of hours and thousands of dollars in your project. Although it may seem the heavy lifting is behind you and all that hard work will lead to smooth sailing from here on out, this is rarely the case. Construction is complicated and there are always areas of the design that need extra thought as they turn from drawings into a building. We also know from experience that if we all work together we can avoid mistakes, resolve challenges quicker, and deliver a higher quality project. This is why we include basic levels of construction administration in our services when we work on custom residential design or take on custom designed ADUs. We respect the expertise of the contractors, the concerns of the clients, and also our unique talents. It is only by working together can your project be a true success.

Siding going up at the Sheltered Nook House, a custom residence we designed outside of Portland, Oregon.

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Other Articles in Our Design Process Series:

1. Phase I - Predesign

2. Phase II - Schematic Design

3. Phase III - Construction Documents

4. Phase IV - Permitting and Bidding

5. Phase V - Construction Administration

Design Process: Phase 4 - Permitting

This is everyone’s least favorite phase of getting a new project completed. Permitting is where you submit all of the design documentation to the local building department to be reviewed and approved before being given permission to break ground and start construction. Each jurisdiction (town, city, county, and state), has their own rules and regulations that guide the design and construction process and requirements for issuing permits. Even for small projects like ADUs, permitting requirements can add a lot of work and time onto the project.

Zoning and planning drawings, construction documents, and building permit applications are typically completed by the design professional, and submitted to the necessary offices or departments by the designer, general contractor, or in some cases a special permit expediting company. The design professional will also respond to questions and comments from the city plan checker as they review the drawing sets. It is typical to receive multiple requests for additional information from the various departments, and the design team will work with them to provide necessary additional information or make edits to the drawings to meet their requirements.

With this all being said, here are some of the aspects of the permitting process that is important to consider to have realistic expectations for what to expect:

Permit fees

It isn’t cheap to build a new project and building departments want a piece of the pie. Although fees vary greatly from city to city, you can expect to pay thousands of dollars in permit fees and system development charges. Permit fees on recent ADUs in Portland have ranged from $8,000 to almost $20,000. The fee range depends on size, value, utility connections, end use of the project, and other factors. Some jurisdictions are trying to incentivize ADUs by offering reduced fees but still, there will be a significant cost here. When you are first considering building an ADU, we highly recommend you call the local building department to ask for an estimate of the permit fees.

Department Reviews

Building plans are just one of the many reviews that take place as part of the permitting process. Each department typically has some involvement in the review and approval of building projects. Transportation departments review site plans for curb cuts, water departments want to understand utility connections, plans examiners make sure the design meets the building code, while planners review the site plan and overall design to ensure it addresses the local zoning codes. Depending on the location you may have reviews for tree coverage or removal, and other environmental considerations for the project. The point here is that permitting involves a series of reviews from the various departments in your local jurisdiction. This is one of the reasons permitting processes take months to complete and cost thousands of dollars.

Changing Rules

This comes up below in the note on politics, but we want to give it some extra attention because it is important for everyone to understand the permitting process. City councils, state legislatures, and national codes and regulations are constantly shifting as new laws are passed and repealed. Unfortunately, these don’t follow a set schedule - new rules aren’t introduced all at once and there is no set time period for rules in place to remain set, allowing professionals to learn how to accommodate new regulations. Rules can change month to month and even when the language doesn’t change, departments can decide to interpret rules differently with very little public notice. It is a frustrating but unavoidable part of the permitting process for ADUs as well as custom homes and other project types.

Checksheets

Your town may call this something different like a plan check comment, but what we mean by checksheet is a list of all the revisions, changes, or additional information the plans reviewer requests in order to approve the project. Typically each department will review the design drawings for specific things they require. For example, the water department will review the site plan for water hookups, sizing of the water meter, and calculation of fixtures to assess any fees. Building code reviewers will check to ensure the design meets all of the local codes for safety. Planners will check that the design meets the local zoning regulations. If the reviewers from each department see something in the drawing that doesn’t meet their requirements or there is missing information that they need in order to give the design their stamp of approval, they issue a checksheet. Sometimes a design may only get a checksheet with one or two items, while other times a more complex project or site may lead to dozens of checksheet items. In our experience, typically a project will get a handful of items and can usually receive a permit after one or two rounds of revisions. It is also important to read the note below about politics and subjectivity in permit reviews as this can have a big impact on checksheets and how many items or revisions are needed.

Permitting Time

This is the million dollar question and oh so hard to predict. Not only is prediction almost impossible but it seems to be getting worse and worse over time. With each added regulation, impacts from the pandemic, perpetually understaffed building departments, and unnecessary complications with the codes and regulations, permitting time can range from months to years! In some cases, like smaller more rural towns, getting permit approval my be straightforward and take days or weeks, but these are rare occasions. Working on projects in Portland would typically take 3-4 months to get approved. Cities in the Bay Area could take 6+ months and sometimes much longer. Seattle would require early submission for planning approval followed by a more intense permitting review when the full design documentation is complete. It could take 6-months to a year on these projects. And these are just rough estimates. Timing can fluctuate based on how many other projects are in line ahead of you, what the staffing situation is at the building department, and even what technology the department uses. Some still require paper submissions vs digital reviews. Call your local building department to get a sense of timeline, submission requirements. This is also information your designer should know or can research for you. In fact, we talk to the local building department as part of our pre-design services to gather as much information about permitting requirements and timeline so we can set realistic expectations for our clients and build this into the project schedule.

Expectations

You should definitely expect some changes will be required to your design in order to get permit approval. For many of the reasons discussed above, it is almost impossible to get a project approved on the first try considering the various rules and regulations and the subjectivity of the review process. Despite years of experience designers and architects are still going to have to work with the staff of the local building department to make revisions to the drawings to comply with all of the rules and regulations

A note about politics in the permitting process:

Planning regulations and building codes change constantly. The interpretation of laws within each city varies from city planner to city planner and from inspector to inspector. Some cities make it easier to get planning approval while others implement systems and processes that make some projects impossible, or simply struggle to keep up with the laws that are constantly changing. No one can keep up with all codes and regulations because they can be interpreted by city officials with almost unchecked control. Although residential designers are experts at navigating this complex permitting process, and work hard in order to get your permits efficiently, it is almost impossible to steering a project through without some challenges and hiccups. You can expect that your project will get some questions and plan checks from the planning and code reviewers. Your designer should work as swiftly as possible to make any necessary revisions and answer any questions from the city offices, but it is important to have some patience and understanding as this process is being navigated.

Conclusion

The permitting process varies a great deal from place to place. Yet it is a necessary step in the process and not one that can be avoided or shortcut. When starting your project it is worth calling your local building department to receive an estimate on the timeline and fees associated with getting your project approved and permits issued. Building in a reasonable schedule and cost into your budget and timeline can help ensure your project stays on track and meets your expectations. This is also a great topic to ask your designer about as you start the design process.

Example of Building Permit Application form from the City of Portland. Forms like this typically comprise of a few pages of information that are required for the permit department to start reviewing a project. Each building department has their own form and processes for permitting.

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Other Articles in Our Design Process Series:

1. Phase I - Predesign

2. Phase II - Schematic Design

3. Phase III - Construction Documents

4. Phase IV - Permitting and Bidding

5. Phase V - Construction Administration

Design Process: Phase 3 - Construction Documents

Once you approve the schematic design work completed in the previous phase, we will begin the construction documents phase of work. This phase includes generating the dimensioned plans and construction details needed to permit the project, describe the design intent for the construction process, and get an accurate bid from the general contractor. This is also when we coordinate our design work with engineering and additional work from other necessary consultants. Basically, this is where we take the design concept, and dive into all of the details and decisions needed to direct the construction of your home or ADU.

Construction Documents

Your design team will take the schematic design and further develop the design including developing dimensioned plans and construction details, coordinate with the structural engineers and other consultants, and work on any details or decisions that could potentially impact the construction cost. This includes the selection of all finishes, fixtures, and equipment (FF&E) - if something is to be attached to the house during the construction phase, we need to accommodate that in the construction documents. We will work with you to make all of the necessary design decisions and material selections necessary to complete the overall design of the project. 

Some of the hundreds of decisions we make during this phase include selecting the doors, windows, flooring, tile, fixtures, appliances, and other finishes. We also draw the interior elevations, cross-sections, key construction details, cabinetry layouts, lighting plans, and other drawings as needed to describe the design intent. Together, we will evaluate and review the construction scope, elements, and details to ensure that the final elements meet the project’s objectives and are aligned with your goals, ideas, and aesthetic taste.  

Each construction document set includes the drawings necessary to describe the specifics of your projects. Typical sets may include drawings such as a site plan, demolition plans, floor plans, roof plan, multiple cross-sections, wall sections, structural engineering drawings and calculations, interior and exterior elevations, construction details, as well as door, window, and finish schedules, as required. Some projects may require additional drawings or fewer drawings depending on the specifics and complexity of the project.

Although we will execute this phase with care, there are often aspects of the design that need to be updated later, during the permitting and construction administration phases of work. This is a standard procedure as part of the design, permitting, and construction process. No construction document set is ever perfect and often drawings or details need to be adjusted based on site conditions, permit review by the local building department, or codes and regulations that may change during the duration of the process.

Engineering and Other Consultant Reports 

During the design process we will determine what additional expertise or reports are required to both guide the construction process as well as get approval from the local building department. Reports and consultant work may include but are not limited to: arborist reports, hazardous materials report, wetland and riparian resource study, geotechnical report, structural engineering, energy efficiency analysis, light and shadow studies, noise study, property survey, other engineering and special inspections, and other similar reports, surveys, and/or studies. We will let you know what additional studies, reports, or consultant work will be required to complete your project as we work through the predesign, schematic design and construction documents phases.

An engineering firm or firms will be enlisted to complete any structural and/or other engineering that is required. We will get cost estimates or bids from each consultant and communicate those costs with you when applicable. All work by consultants become part of the construction documents set and the General Contractor must abide by all drawings, calculations, reports, and studies as they construct the project.

This is a drawing sheet from one of our ADU Construction Document sets, which includes a floor plan, roof plan, and reflected ceiling plan along with notes and legends to help clarify the drawings for the general contractor and their team.

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Other Articles in Our Design Process Series:

1. Phase I - Predesign

2. Phase II - Schematic Design

3. Phase III - Construction Documents

4. Phase IV - Permitting and Bidding

5. Phase V - Construction Administration

Design Process: Phase 2 - Schematic Design

The Schematic Design phase of our design process is similar whether we are working on a small ADU or a large custom home. This is when we guide you through the development of the look and feel of your project. Design can be a lot of fun and the Schematic Design phase is a dynamic, collaborative process between our design team and you, the clients. Typically, we develop up to three conceptual designs to discuss various options to meet your goals and ideas. These conceptual options will include a site plan, floor plans, elevations, building sections, sketches, and the layout of the interior rooms such as bathrooms, bedrooms, kitchen, and living areas, to describe how the custom home or ADU would look and how you would use the spaces.

Presentations and graphics

In order to describe the design intent we use a range of architectural drawings and graphics to visualize various aspects of the project. You may be familiar with floor plans, but we use other drawings as well, in order to help us describe our ideas and demonstrate how the project will work and what it will look like. This includes hand sketches, computer generated perspective drawings, plans, sections, and elevations. We also often use precedent images to help you better visualize what the end result could look like. In some cases clients even ask us to build physical models to visualize what the building will look like in three dimensions.

Design is a dialogue

We share our drawings and graphics with you and also hold a series of meetings throughout the schematic design process to present what we came up with and describe how it addresses your needs and responds to your aesthetic preferences and project goals. These meetings typically start out with us presenting the work we developed, but ultimately they are collaborative work sessions, where together we edit and refine the design ideas with your feedback and input. These early discussions help us refine the design until it arrives at a design that you love.

One of the questions we often get asked by prospective clients is how they can know they will like the design we create without seeing it before they hire us. It is this design dialogue that makes us confident that each of our clients will like the design of their project. We don’t work in a vacuum and we don’t impose our design ideas on our clients. Design is an iterative process that takes your goals and ideas and couples that with our expertise and guidance to guide the project to the ideal design for the specifics of your needs. The Schematic Design phases is where we work together to craft a beautiful and functional home.

Revisions and adjustments

Once the preferred option is developed in our design meetings, the design team will refine the design to address your ideas and feedback. We make adjustments to the floor plans and location on the site, and start adding details for room layouts and ideas for materials. During the revision process we give you additional opportunities to talk through the function of each space, how the flow works from room to room, and how the project relates to the existing conditions of your property. We also discuss the big ideas for materiality, views, systems, and other elements of the building that could impact the details and cost. 

With the feedback and information from these revisions and adjustment conversations the design team will do one final round of revisions to dial in the design to the final option that will be the bases for the next phases of the project.

Additional work during this phase

Above we described the process that we guide our clients through on the design side. However, there is other work that needs to be carried out during this phase by other experts and consultants. Here are some of the things to expect.

Surveys

A survey by a licensed surveyor is required for all new construction projects. We will help identify a licensed surveyor in your area and you will contract directly with them to create a detailed topographic site survey. Often this work starts during the predesign phase but needs to be complete before we dial in the final schematic design option.

Budget Development

When the final schematic design option is decided upon it is a good time to get a rough estimate for the cost of construction. We recommend that the client engages a general contractor at this phase of the project who can create a construction estimate and collaborate with us during the following phases to further develop the design and meet the stated budget. We can help you select a contractor for this estimate work.

Perspective sketch for a sustainable custom home outside of Portland, Oregon.

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Other Articles in Our Design Process Series:

1. Phase I - Predesign

2. Phase II - Schematic Design

3. Phase III - Construction Documents

4. Phase IV - Permitting and Bidding

5. Phase V - Construction Administration

Design Process: Phase I - Predesign

Whether you are looking for a full custom home for your family, a major addition or remodel to give your existing home new life, or you want to add a new Accessory Dwelling Unit (ADU) to your property, each project begins with research to determine what is allowed and build a familiarity with the existing conditions.

Pre-Design is the first step we undertake for each project. We work closely with you and your family to establish the goals of the project, understand the various codes and regulations, research the challenges and opportunities, and document the existing conditions. This background research creates the framework for all future design work.

Specific tasks that we undertake during PreDesign includes site analysis, zoning research, project budgeting, programming, we discuss the timeline, and assemble the project team. The more information gathered during the predesign phase, the more accurate all future work can be. It is vital to dedicate the time and resources needed to thoroughly research all the various forces that affect a project as it can help avoid costly mistakes or changes further along in the design and construction process.

Site Analysis

The main goal during this phase is to gather information. During the Pre-Design phase, we will research and document your property to understand the context in which we will be designing. This starts with us measuring existing conditions, locating any features on the site that could affect the design, and documenting the property with photos for future reference. We also ask that clients engage a licensed surveyor to survey the property during this stage.

Along with analyzing the site we also research what the zoning allows for your property and any other codes and regulations that will affect the design. Sometimes things like Homeowner Associations, or district overlays can add complications to the base zoning allowed by the city, town, county, or state. We aim to identify all the various regulations that will affect the project during this research.

Programming

Next in the research phase is understanding your goals for the project, your ideas, your aesthetic values and style, and defining what a successful project looks like from your perspective. To accomplish this we meet with you to discuss what you value in a home, identify all of the spaces you require, what functionality is important, and define styles that inspire you. We have specific questions we go over and also create spreadsheets to document the specific metrics to consider while designing - things like square footage, specific rooms you want, sizes, budget considerations, and other elements of the project we need to consider when beginning the design process. This provides a foundation on which we build our architectural design ideas.

Budget

Although it is still very early in the overall timeline of design and construction, it is important to define the target budget for the project. Typically we start these conversations much earlier, as part of our proposal process, but we revisit this conversation here to verify what you are looking to invest in the project. I’d like to emphasize how important it is for clients to have an open and honest conversation about what they can afford to invest in the project. If we don’t know what you want to spend we can’t make design decisions and offer advice to meet your expectations. The more accurate of a budget we can develop, the more we can guide you through the hundreds of decisions needed along the way. It will also give us a framework to work within while we discover the ideal design solution for your needs.

Timeline

As with the budget, we give a rough overview of the project schedule during the early discussions with each new client and within our proposal. However, once we begin the work and start learning about all the various aspects of your project through our research, we can better understand how long the project may take. We thus create a more accurate project schedule at this point and identify key dates, milestones, and meetings. Once the key meeting dates are defined we build a Gantt chart schedule to outline the scope of work. We also send out calendar events for those meetings so they are on everyone’s calendar and we can keep the project on schedule.

As for this phase itself, we typically suggest budgeting 1-2 months for Predesign, depending on the type of project. Detached ADUs maybe be on the shorter end of this range, while major remodels or full custom homes can take 2 months or even longer to gather all the required information to move forward into the design phases.

Project Team

There are a range of professions that need to come together to deliver a great project. Predesign is the time to start identifying the various consultants that will work with us to define the project and craft a beautiful design. This includes professionals that will assist with the research in this phase, like surveyors, geotechnical engineers, arborists, and sometimes civil engineers. We also begin to identify and contract with the professionals we will work with later on in the design process. Knowing that people are busy we want to get your project on their schedule to enable us to keep the project on schedule. Typically we identify a structural engineer, landscape designer, and other consultants that may be needed depending on the scope of work.

We also recommend identifying and interviewing General Contractors this early in the process. Having a great GC as part of the team early on, allows us to get feedback as we embark on the design process regarding cost, constructibility, and other information that could affect the design and budget.

Conclusion

Although Predesign isn’t what people think of when they hire a designer or architect for their custom home or ADU project, it is a vital part of the design process. Investing time and effort in this initial phase can save headaches and money later on in the process. It is important to be thorough and truly understand all the variables that will affect the design work to come.

To learn more about our design process or to kickstart your project please get in touch. We would love to learn about your project’s goals and ideas and help you craft a beautiful design.

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Other Articles in Our Design Process Series:

1. Phase I - Predesign

2. Phase II - Schematic Design

3. Phase III - Construction Documents

4. Phase IV - Permitting and Bidding

5. Phase V - Construction Administration

ADU Cost: What Can We Learn From Portland?

We look at ADU Costs in Portland and around the country with designer Lucas Gray, who has been designing custom ADUs for several years. Portland is a very mature market, so it's nice to look up there to see what we can learn about the costs of building an Accessory Dwelling Unit (ADU). Lucas Gray, from Modern ADU Plans, came on the show to talk shop and goes into the costs of ADUs, what homeowners can do to budget and control their ADU cost, and more.

If you are thinking of adding an ADU but are curious what sort of investment you will need to make, watch this interview to learn more about how much Accessory Dwelling Units cost and other tips on the design and construction process. It is important to compare the investment you make in creating an ADU with the return you will get through rental income, property value increases, and other benefits. ADUs aren’t cheap, but they are a great investment when you weight the costs and returns.

It is also important to consider that costs can cary greatly from place to place. California ADUs may cost a lot more than Portland ADUs or Texas ADUs, but with higher rental prices these projects often make sense in any location that they are allowed.

ADU Requirements Around the Greater Portland Metro Region

Although we started working on ADUs by doing custom designs for our clients, we are now selling ADU plans much further afield from our Portland roots. Unfortunately, there aren’t any standard ADU regulations that permeate across the country. Instead, each town, city, county, and state has their own rules and regulations. Starting in the greater Portland Metro region we will start adding links and resources for various requirements for ADU projects.

Although there are many similarities with requirements for Accessory Dwelling Units in areas outside of Portland, Oregon (or even the states of Washington and California) there are aspects of the general requirements that we also see vary by town or county jurisdiction.  What we've noticed that can change across jurisdictions are:

• the size of ADU's (ex. maximum sizes can range from 400-1200sf and codes are often changed over time)

• height limitations (we’ve seen rules that dictate ADU heights from 10’ to 20’ and in some places there may not be a height limit at all)

• the types of ADU's allowed (ex. Detached, Attached, Basement, Garage, junior, or others)

• the number of bedrooms (ex. a limit of 1, 2, 3, or no limit)

• are ADUs even allowed (unfortunately many jurisdictions still don’t allow them and within jurisdictions, some neighborhoods or HOAs limit ADUs further.)

• Style (some places have rules on what an ADU can look like.)

The common theme is that town planning departments and communities generally accept Accessory Dwelling Units, although they aim to "maintain the character" of the neighborhood, and this sets the setback(s) and/or limits the height so that the primary residence remains the dominant element present to the street.

In order to help clarify all of these differences, we have listed some resources below for the towns and cities around the Portland region. While we're only covering a few of the towns outside Portland to the south and west, we hope to add more to this list over time, so if you would like us to look into and add your town to this list, please get in touch!

Accessory Dwelling Unit or ADU Requirements, by town:

Clackamas County ADU Requirements

Clackamas Maps

Clackamas County Zoning Map (PDF)

Clackamas County Zoning Code Table 315-1: What Zones are ADUs allowed in

Gladstone R-5 ADU Requirements

Gladstone R-7.2 ADU Requirements

Milwaukie ADU - Attached

Milwaukie ADU - Detached

Oregon City ADU Requirements

Tigard ADU Requirements

Portland ADU Requirements

Portland ADU Zoning Code

Vancouver, WA ADU Requirements